Skip to Content

A Practical Guide To Futureproofing Your Personal Finances

A Practical Guide To Futureproofing Your Personal Finances

Sharing is caring!

Things are starting to look a little brighter out there as we head into summer, and we’re not just talking about the weather. We are finally starting to see the results of more than a year spent locking down and gritting our teeth and now the vaccines are rolling out and we’re seeing our friends and families for the first time in ages. We have been through an awful lot over the last twelve months and more, and many of us have been really struggling to keep our heads afloat through the financial difficulties that the pandemic created.

If there is one thing that we have learned during the Coronavirus pandemic, it is that there is always the chance that something unexpected could come along and make a mockery of all our carefully crafted plans. Because of this, many of us have been thinking about how we can bolster our finances to better prepare for whatever unpleasant surprises the future may hold. With that in mind, here are a few practical tips to help you get ready for any rainy day that might be heading our way.

Take A Good Hard Look At Your Spending Habits

Let’s face it, our spending habits have been somewhat all over the place over the last twelve months. A lot of the usual things we’d be spending on casually, such as nightlife venues and sporting events, have been closed, and we’ve splurged a lot more on treats like takeaways and online shopping.

Now that things are getting back to something approaching normal, it’s time to really look at your regular expenditures. There will always be something you can trim, whether it’s that cup of coffee you buy on the way into work, the streaming service that you haven’t used since summer last year, or something bigger. Think about whether your family needs that second car, for example, when we’re all working from home.

Think About Possible Future Expenses

This one is a little trickier as there’s no telling when your computer will suddenly give up and die on you, for example. But the further in advance that you can plan for these big costs, the less disruptive they’ll be. That desktop computer is a great example, but it’s also worth thinking about things like potential house moves, home refurbishments, expensive medical procedures and so on. We can’t afford to have these big life expenses leave us at the bottom of our savings accounts, so try to keep a separate cushion for these.

Get Your Insurance Plan In Place

It seems safe to assume that you have a reasonable amount of insurance in place already, from home to car to pet. When we talk about futureproofing our finances, knowing that you have a proper comprehensive insurance plan in place goes a long way to making us feel more comfortable and secure.

But for many of us, that rainy day last year wasn’t an accident in the home or a car breakdown. It was suddenly finding ourselves out of a job with little to no warning as our employers struggled to make it through the pandemic. If you are looking for ways to better protect yourself against a period of unemployment, then income protection insurance is an excellent choice. You could recover up 70% of your gross annual salary if you are made redundant or suffer an accident or sickness that leaves you unable to work. How much does Income Protection Insurance cost? You can find out by getting a quote from Drewberry Insurance, which has a 4.92 review rating from UK users.

Start Your Retirement Savings Plan Now

One of the biggest mistakes that so many people make when it comes to their pension or retirement savings plan is that they simply do not start early enough. People who leave it until their 40s, or even their 30s, will often find themselves really having to fight to make up ground.

So, start by looking into what kind of pension plan your employer offers. Some companies offer to match their employees’ investment, and that is absolutely worth taking advantage of. Look into whether an ISA could help you get a good start on your savings. If you have invested in stocks, it’s time to take a careful look to see if they are working for you.

Diversify And Stay Flexible

Planning for the future is not always easy, and when you are putting money away it can feel like the simplest thing to do is to put all your eggs in one basket. However, if you really want to future-proof your finances then you should look at diversifying. Don’t bet all you have on one company. Don’t assume that the property you bought will continue to increase in value (although it seems like the market is heading that way right now). The last year has shown us just how important flexibility is and diversifying is a great way to stay on your toes and minimise risk.

Sharing is caring!